Republic Services Misses Estimate

The provider of solid waste collection, transfer, and disposal services reported a net loss in the fourth quarter, hurt by restructuring and other charges.

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On February 27, 2009, Republic Services ( RSG), a solid waste collection, transfer and disposal services provider, reported that it swung to a net loss during Q4 FY08, hurt by restructuring and other charges. Net loss stood at $131.70 million, or $0.55 per share, compared to a profit of $82.10 million, or $0.44 per share, in the prior year's quarter. Excluding special items, earnings declined 6.8% to $0.41 per share, thereby missing the consensus estimate of $0.44 per share.

Total revenue for the fourth quarter soared 56.3% to $1.24 billion from $796.00 million, driven by the acquisition of Allied Waste Industries. Looking at the company's business segments, collection revenue spiked 60.1% to $973.60 million from $608.10 million, helped by a 63.5% increase from residential collection, a 64.4% increase from commercial collection, and a 49.5% increase from industrial collection revenue. Additionally, revenue from the transfer and disposal segment spiked 60.2% to $228.50 million from $142.60 million in the year-ago quarter. However, other revenue declined 6.6% to $42.30 million from $45.30 million on a year-over-year basis.

During the quarter under review, Republic Services and Allied Waste Industries completed their merger to create one waste and environmental services provider. Recently, the company declared a regular quarterly dividend of $0.19 per share, payable on April 15, 2009.

For FY08, total revenue advanced 16.0% to $3.69 billion from $3.18 billion in the previous year. Net income for the year plummeted 74.6% to $73.80 million, or $0.37 per share, from $290.20 million, or $1.51 per share, in FY07.

Looking forward to FY09, the company expects revenue to increase by approximately 129.0%. Furthermore, earnings before the impact of the Allied merger and restructuring charges are anticipated to be in the range of $1.70 to $1.75 per share.